CDs and Tower Records rock on in Japan, just a little while longer

When it appears that everyone in the world has moved on to digital music, downloads, and the iTunes music store, it seems a stark anachronism that a country always known to be a constant source of leading edge technology such as Japan would still hold on to compact discs for music – but that is reality and fact, not our imagination. By extension, as Japan still remains one of the world’s last markets for CD music, the Tower Records stores in Japan still persist when every single one outside of Japan has gone bankrupt and closed down.

On Friday, Tower Records Japan’s CEO Ikuo Minewaki said that the continuing popularity of CDs in Japan sustains the retail chain in the country – long after the U.S. parent company went bankrupt in 2006. In fact, Minewaki says that the Japanese arm – already 86 stores strong – is looking to add more outlets all over the country. “The Japanese market is very different from the rest of the world,” said Minewaki, speaking to reporters on Friday. Global sales of physical CDs have been understandably plunging under pressure from a surging digital download market, but Japan curiously bucks this trend at all points. According to numbers from the Recording Industry Association of Japan, Japanese CD sales actually increased by 9% in 2012. Tower Records Japan is owned by wireless and mobile carrier NTT DoCoMo Inc.

Minewaki said that the enduring popularity of CD music has much to thank for in the strict implementation of intellectual property rights laws in the country, as well as the willingness of most of the citizens to obey them. The Japanese have also been relatively slow in switching from local feature phones – the keitai denwa (literally, “portable telephones”) – to smartphones, a trend that heavily accelerated the movement towards digital music all over the world. In fact, only in Japan will one probably still see the popularity of rental CD shops (!!!) – where Japanese consumers rent and then copy music, still considered a cheaper alternative to buying songs or albums online.

But it would be a great shortcoming to overlook what Tower Records in Japan has done to continue its business – the marketing push has been nothing short of amazing. This is evidenced partly in rival store HMV Japan, as that particular music retailer closed its doors in 2010, failing to keep itself relevant and fatally suffering the consequences. Minewaki says that Tower Records’ successful “hand shake events” – where Japanese fans can shake the hands of their favorite idols in regular in-store events and concerts – have been one of the things that have kept them in business. Events for wildly popular acts like Japanese all-conquering female idol group AKB48 are big people and fan magnets. “One recent event brought 300 people to the store, and together they bought nearly a 1,000 CDs” said Minewaki. AKB48 regularly sells over a million CDs copies on the first day of a release, so it is not surprising that Tower Records Japan still stands. Minewaki acknowledges though that it is the live experience – whether music or personality – that the Japanese fans love, and the CD is just an extension of the hype. “In Japan, we enhance the actual experience of buying the CD,” he said. “But digital music is growing quickly,” he adds and says that eventually CDs will be inevitably replaced. But wonderfully for Tower Records Japan, just not right now.

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